The Basics of Fair Trade Coffee

The Basics of Fair Trade Coffee

Fair trade is a term becoming more common when talking about coffee in the global marketplace, and rightly so. This post couldn’t possibly address all of the concerns related to fair trade (or even just fair trade coffee) but it will provide an overview of the general history, social impact, and biggest issues facing the fair trade movement as it relates to its largest product: coffee.

Definition and History

The fair trade movement began in the mid-1980s, as the end of the Cold War set the stage with a period of intense globalization in market economies. Essentially, more goods were being produced in third-world countries and then were being imported into first-world countries. This was primarily happening in North America and Europe, because it was cheaper than mass-producing those same products in their local markets. Importing overseas had been done for years before (the same principle was employed by the British Empire and most of Europe with their colonies during the 18th and 19th centuries) but the 1980’s saw a huge rise in this kind of activity. The growth of many large corporations occurred and involved multinational production, especially in the case of farming sugar, cacao, and coffee.

Fair Trade and Coffee

The fair trade movement started as an effort to get living wages paid for independent coffee farmers who were living in third-world countries. The lack of regulations on economic activity in most of these countries, and the influence that the large corporations in those areas had, left most independent coffee farmers without a market to sell their produce to without being undercut.

The fair trade movement sponsored co-operative organizations (“co-ops”) that bought independent farmers’ coffee at a higher price. They would then sell it in first-world countries under the label “fair trade.” This meant that it was ethically sourced coffee and the farmers who produced it would be paid fairly for their produce.

Fair Trade Certification

Fair trade essentially works the same way now. Farms who are certified, may join co-ops who are part of larger multinational organizations. Those organizations then find markets for their produce. They also sponsor social action in the countries where the coffee comes from, building roads, hospitals, schools and creating sources of fresh water.

Obtaining fair trade certification is completed by contacting a recognized third party that examines a farm. The examination is based on the following criteria:

  • whether farmers are paid fairly
  • whether the farming practices employed are environmentally sustainable
  • whether trading is done directly with the farmers in place of a middle man
  • whether there are acceptable living conditions for the workers there

A farm that is certified by this process, may then sell its products under the fair trade label. A common misunderstanding is that while many fair trade farms grow organic produce, this is not necessarily a requirement for fair trade certification. The two terms should not be confused, though there is a lot of overlap as produce that comes from fair trade farms is very often also organically grown. However, you can easily tell if a product has been produced by a fair trade farm by checking the label on the packaging itself. If no label is present, the product isn’t fair trade. Also, although coffee is the most commonly-produced fair trade commodity, it is by no means the only one. Produce such as bananas, sugar, mangoes, grapes, and even non-produce commodities like soccer balls and craft items, are available as fair trade purchases.


It’s impossible to find a movement as large as the fair trade movement, without finding some kind of controversial news to go along with it. Especially when a movement is steeped in economics, globalization, and the legacy of European colonialism. Generally, free trade controversy comes from outside the movement itself. Mostly, these issues revolve around the fact that consumers of fair trade products pay a higher price for goods, with the expectation that they are helping the poor by doing so.

If the poor are not being helped by the extra money which these products charge, then the fair trade organizations involved are responsible for exploiting an underserved population in a third-world country, and for misrepresenting the products they sell to their consumers by marketing them at a higher price under false pretenses. Both of those accusations are quite serious, so it’s no surprise that there have been some very serious inquiries into fair trade organizations over the years.

Although the movement as a whole was founded on admirable principles, it hasn’t stopped some people from exploiting it. There have been documented cases of corruption and negligence that have led to the worsening of conditions for certified farmers on occasion. That said, not every fair trade organization is run by incompetents or criminals, but it’s probably a good idea to look into the reputation of any charitable organization.

The other main controversy regarding fair trade, comes from within the community itself. Some fair trade organizations, mainly in the United States, believe that corporate-owned plantations should be allowed to pass certification as fair trade farmers and market their products under a fair trade label. Other members of the community disagree because corporate plantations do not require a co-op for distribution. Because of this, they may continue to take business away from the independent farmers that the fair trade movement was meant to help, by marketing “fair trade” coffee that is cheaper than other fair trade coffee.

You may be thinking that this is a lot to think about when simply buying a bag of coffee.  However, fair trade coffee regulations have done a great deal to help protect the farmer’s wages, and to manage globalization issues.  Whether consumers are aware of these issues or not, they are supporting the system by the products they choose to buy. When it comes to free trade coffee, it is definitely an easy way to identify that you are supporting the entire chain of the coffee production line from the farm to your mug, but just because a coffee is not labeled fair trade doesn’t mean that it was not sourced fairly.  In many cases, direct trade relationships between buyers and growers eliminate the need for official certification and allow all parties to save on certification costs.


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